Some Dublin stockbrokers are potentially engaging in market manipulation by seeking to place largescale orders for stocks which are then not implemented, the Financial Regulator has concluded after a long investigation.

The regulator has been unable to take any action because the current legal definition of market manipulation is too limited, it claims.

In a recent update the regulator disclosed the following: "One case, which was closed after a full investigation including extensive interviews and international work, highlighted the limitation of the current legal definition of market manipulation''.

The regulator, following questions from the Sunday Tribune, revealed that it has concerns that under certain circumstances attempted market manipulation "does not constitute an offence''. The regulator declined to name the party investigated.

It is understood that the issue has been raised now at a European level. The Irish Financial Regulator is a member of the Committee of European Securities Regulators (CESR) and it said it had been very "vocal'' in this forum to have changes made.

"CESR has recommended to the EU Commission that this be changed and Ireland strongly supports this recommendation,'' said a spokeswoman.